Money & medicine: Getting a handle on your financial future
As you begin the next chapter in your medical career, here are three steps you can take now that could improve your financial health.
PLANNING
WRITTEN BY TAMARA YOUNG
September 2024
Becoming a doctor is a demanding pursuit, often leaving little time for anything else — including your finances.
Create a budget to stay organized
IMAGE: INNA GERTSBERG
As you begin your clerkship, you could experience changes in your spending. While the first two years of medical school were somewhat predictable (books, tuition, rent, etc.), clerkship can introduce new spending habits. For example, you could find yourself allocating more money toward transportation and eating out than you did before.
Creating a budget can help you stay on top of your finances, especially when money is still tight and the cost of living is high. It may also give you some insights about your spending habits. You may not realize, for instance, just how much money you've been spending at the cafeteria until you see the total on your spreadsheet. To build a budget, start by gathering and categorizing all of your monthly expenses into a single document — groceries, your phone bill, bus fare, tuition, rent, etc. From there, separate your fixed expenses from your discretionary ones to begin identifying potential opportunities to save. (You could start making your lunch, for example, instead of buying it.) Keep doing this every month.
While you may not be able to cut spending by much while you're still in medical school, a budgeting habit could support your financial health as you begin your residency and throughout the rest of your career.
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Despite the potential for a higher-than-average income in the future, many medical students find themselves grappling with financial challenges during their training. The intense focus on academics and clinical practice can sometimes push financial planning to the back burner. However, taking steps now to understand and manage your finances can set you up for a stronger financial future. Here are a few ideas to consider.
Disclaimer
FOOTNOTES
1 "Financial lessons doctors learned about money management," TD Economics, accessed August 7, 2024, https://www.td.com/ca/en/investing/wealth/health-care-practitioners/financial-lessons-learned-by-doctors
2 "The AFMC Graduation Questionnaire: National Report 2022," The Association of Faculties of Medicine of Canada, October 25, 2022, accessed August 7, 2024, https://www.afmc.ca/wp-content/uploads/2022/11/GQ2022_national_complete_EN_25oct2022.pdf
Many medical students carry significant levels of student debt — just over 47% report owing more than $100,000.1 While many government student loan programs allow you to defer repayment until after you graduate, other lines of credit, such as personal loans and credit cards could already be accruing interest. If you find your high-interest debt growing rapidly, you can consider speaking to your financial institution about debt consolidation. Post-graduate loan forgiveness and student relief programs could also be an option for you, depending on where you end up practicing.2
Use debt wisely
Now can be a good time to start thinking about the personal goals you'd like to achieve beyond becoming a doctor. Do you want to buy a house someday? Start a family? Should you wait until after your debt has been repaid to get started? Preparation is key for these important life moments, and it's never too early to start thinking about them.
The beginning of your clerkship is an exciting and important milestone in your professional life. But it won't be the last.
If you have questions about how to prepare for your financial future, TD Wealth has a team dedicated to finding solutions for healthcare professionals. They are familiar with the nuances of your unique career path and can help you get started.
Consider your long-term financial goals
Visit the TD Wealth for Healthcare Professionals website, where you can find more information about how to get a handle on your financial future.
Lifelong care for your financial well-being
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Visit the TD Wealth for Healthcare Professionals website, where you can find more information about how to get a handle on your financial future.
Lifelong care for your financial well-being